China announced Friday it will impose a 34% tariff on US goods, striking back after President Donald Trump announced new tariffs on imports from almost every country in the world.
Beijing called Trump’s tariffs “inconsistent with international trade rules” and condemned what they described as unilateral bullying by America.
The State Council, China’s cabinet, announced the measures and vowed further action if necessary.
The Ministry of Commerce then outlined a series of non-tariff responses, including suspending export licences for 16 US firms over claims their products have potential military applications, and adding 11 companies to its “unreliable entities list.”
China also launched an anti-dumping investigation into a type of medical X-ray tube brought in from the US and India.
The swift retaliation came amid sharp declines in global stock markets.
Asia and Europe saw steep drops following the latest round of tariffs in the escalating trade war.
Investor fears of a full-blown trade war and a possible global recession have spread, dragging down markets in Australia, Japan, and South Korea on Friday.
Major US stock markets also ended Thursday’s session lower, with the S&P 500 suffering its worst one-day fall since mid-2020.
China has been among the hardest hit by Trump’s wave of tariffs this week, prompting its promise of “firm countermeasures.”
In response, Trump hinted he might be open to negotiating separate deals with some nations, prompting renewed interest in Washington from Japan, Vietnam, and Taiwan.
Despite that sign of possible compromise, many experts remain sceptical, noting the president’s earlier refusals to consider exemptions.
In Japan, stocks plummeted, with the Nikkei index down more than three percent in early afternoon trading.
Automakers, including Toyota and Honda, were among the biggest losers.
Japanese Prime Minister Shigeru Ishiba called the tariffs a “national crisis” and urged his ministers to study the tariffs carefully and develop measures to lessen the economic shock.
Across the region, Australia’s ASX-200 closed 2.3% lower, and South Korea’s KOSPI fell 1.6%.
Trading in both mainland China and Hong Kong was closed on Friday for the Tomb Sweeping Day holiday.
Trump delivered his latest tariff blitz on Wednesday, proclaiming it a “Liberation Day” for American manufacturing.
He added a 34% tariff on Chinese imports, on top of the 20% levy introduced in February when he accused Beijing of failing to curb the flow of fentanyl into the US.
Some goods, such as appliances, machinery, and clothing, now face tariffs as high as 45% following Trump’s earlier rounds of trade penalties.
Trump also slapped a 24% tariff on Japan and a 25% tariff on South Korea, targeting two key US security allies that hold major trade ties with Washington.
Taiwan was hit with a 32% tariff, although its advanced semiconductors escaped the new tariffs.
Meanwhile, countries like Cambodia and Vietnam, seen as alternative production hubs for global supply chains, were burdened with even higher tariffs, Cambodia at 49% and Vietnam at 46%.
Thailand faced a 36% tariff, adding to the sense of urgency among Asian nations looking to mitigate the impact of Trump’s policies.
With China’s announcement now fuelling heightened anxiety, businesses worldwide are bracing for the next phase of an escalating trade war that many fear could destroy the integrated global economy.